1. Field of the Invention
The present invention relates to the field of electronic billing and paying systems. More particularly, the present invention relates to a secure interactive electronic statement delivery system suitable for use on open networks such as the Internet.
2. Background Art
Every month, millions of customers receive bills and other account statements from utilities, banks, stores, credit card companies, insurance companies, and other service providers. Almost all of these account statements are sent by mail.
A typical bill includes four primary components:
1. Summary information. Typically includes an amount due, a due date, a customer account number, a statement issuer Killer) name and address. The summary information is often printed on a detachable remittance stub that is intended to be returned by the customer with a check for payment.
2. A pre-addressed return envelope.
3. Detailed invoice of charges. Typically includes a detailed listing of the charges accrued. For example, if the account statement is a telephone company bill, the detailed invoice will list details of each toll call. The detailed information may include legally mandated information, particularly if the statement issuer is a public utility. For example, an electric company may be required to list monthly or yearly comparisons of a customer's energy use. The content and format of such legally mandated information may vary from one legal jurisdiction (town, county, state) to another.
4. Marketing materials. Statement issuers typically include information such as newsletters announcing new products or services, and often also include third party advertising pieces.
A customer typically pays a bill by writing a check for the amount due, placing the check and the remittance stub in the return envelope, sealing and stamping the envelope, and placing it in the mail.
For every bill received and paid by a customer, a billing institution (biller) has to perform numerous paper, handling tasks. Fist, the biller has to generate the bill and mail it to the customer. The bill generation process involves retrieving billing data for a customer, formatting the billing data in the legally prescribed manner, printing each customer's bill, placing the bill and other included materials in an envelope, and mailing the envelope to the customer. The biller also has to process the payment remittance received. Remittance processing involves opening envelopes, identifying the customer's account, extracting the check, and presenting the check for payment Given the large volume of bills sent out and payments received each month, the paper handling involved is a massive and expensive undertaking.
Various systems have been proposed to reduce the paper handling involved in bill paying and remittance processing. For example, there exist electronic bill payment service bureaus that allow customers to electronically pay their bills via a home computer or telephone. However, although use of these bureaus make bill paying more convenient for customers, they make remittance processing more expensive for billers because the payments forwarded to the biller by the bureau are exception items for many billers. When using a bill payment service, a customer directs the service bureau to make payments to the biller. As a result, the remittance is not presented to the biller in the usual way, i.e. a check with the biller's remittance stub in a single envelope. Instead, the biller receives payment, without the remittance stub, from the service bureau. The payment itself, depending on the practice used by the service bureau, may take a number of forms. The biller may receive a check printed by the service bureau drawn on the customer's bank account containing the customer's account number with the biller and MICR (Magnetic Ink Character Recognition) data encoding the customer's bank account number. Alternatively, the service bureau may consolidate payments from several. customers to a biller into a single payment. In this case, the biller receives one payment and a list of customers whose bills have been aggregated into the single payment In another automatic bill payment system, a customer pre-authorizes a biller to automatically deduct amounts due from the customer's bank account using the Automated Clearing House ("ACH"). In this case, the biller must comply with ACH procedures for validating and obtaining payments.
U.S. Pat. No. 5,465,206, issued Nov. 7, 1995, for "Electronic Bill Pay System", assigned to the assignee of the present invention and incorporated herein by reference, discloses a bill pay system that allows customers to pay bills to participating billers through a centralized payment network operating according to preset rules. The participating customers receive bills from participating billers which indicate an amount owed and a unique biller identification number, which is assigned by the payment network. The bills may be mailed bills, e-mail notices, or implied bills for automatic debts. To authorize a remittance, a customer transmits to its bank, which is a participating bank, a bill pay order indicating a payment date, a payment amount, the customer's account number with the biller, a source of funds, and the biller's biller identification number. The customer's bank then submits a payment message to a payment network. The payment network forwards the payment message to the biller's bank. For settlement, the customer's bank debits the customer's account and is obligated to a net position with the payment network Likewise, the biller's bank receives a net position from the payment network and credits the biller's bank account. The biller receives payment details from the biller's bank, or alternatively directly from the payment network, and updates its accounts receivable records. The customer initiates bill pay orders manually via paper correspondence, at an ATM, via PC, or via telephone keypad.
Prior art systems have primarily addressed the bill payment portion of customer bill processing. The bill generation and presentation portion of customer bill processing has not yet been satisfactorily addressed. U.S. Pat. No. 5,465,206 suggests that bills may be sent electronically by e-mail, but does not elaborate. U.S. Pat. No. 5,007,084 for "Payment Authorization and Information Device", issued Apr. 9, 1991, describes a home terminal for receiving and printing out billing information. The billing data is simple text data received by the customer via an encoded signal broadcast by a centralized invoice distribution center during vertical blanking intervals of a television broadcast or via telephone lines and a modem. A special device is used to decode and print out a hard copy of the received text. The same device can be used to pay the bill electronically.
The electronic bills delivered by these systems consist of simple text messages. As such, the electronic bills cannot deliver the same variety of information and materials as, and are therefore a poor substitute for, traditional mailed paper bills. Furthermore, these systems require the use of a specialized, centralized distribution network and/or special equipment.
Security is an issue for messages and other data transmitted over open networks such as the Internet. Encryption is one mechanism that can improve the security of transmitted communications. Two well known types of encryption are secret key encryption and public key encryption.
Secret key encryption is a symmetric form of encryption in which the same key is used to encrypt and decrypt messages. To encrypt a message, the message and the secret key are supplied to a software encryption program that transforms the message by means of an encryption routine that uses the secret key and the message as an input The original message can only be obtained from the encrypted message by applying a reverse, decryption process, which transforms the encrypted message by means of a decryption routine that uses the encrypted message and the secret key as an input Because the same secret key is used for encryption and decryption, both the sender and the recipient of the encrypted message must have a copy of the secret key. The security of secret key encryption can therefore be compromised by either the sender or the recipient.
Public key encryption is an asymmetric form of encryption that uses a two-key pair, typically referred to as a public key and a private key. In public key encryption, messages encrypted with either one of the public and private keys can only be decrypted using the other key. For example, a message encrypted with the public key can only be decrypted using the private key. Conversely, a message encrypted with the private key can only be decrypted using the public key.
The terms "public" key and "private" key stem from the manner in which public key encryption is often used. A party concerned about security of its incoming communications generates its public and private keys. It keeps its private key secret, but freely distributes its public key. Any party wishing to send a confidential message to the party that generated the keys can encrypt its message using the freely available public key. Since the message can then only be decrypted using the private key, which the receiving party keeps in its sole possession, the sending party can be assured that only the receiving party will be able to decode the encrypted message.
Another security mechanism that can be used in conjunction with public key encryption is a digital signature. The purpose of a digital signature is to confirm to the recipient that a message that is sent has in fact originated with the purported sender.
One form of digital signature uses a message digest. A message digest is a value that is generated when the message is passed through a digesting program, which may be a hashing routine. An ideal digesting program is one for which the probability of two different messages generating the same message digest is extremely low. In this form of digital signature, both the sender and the recipient need to know which digesting program is being used. The sender generates the message, and generates a message digest by passing the message through the digesting program. The sender encrypts the message digest with the sender's private key. The result of this encryption then becomes the digital signature which the sender appends to a message just as a holographic signature would be added to a paper document. Finally, the sender encrypts the entire package with the recipient's public key, and sends the encrypted package to the recipient.
The recipient receives the encrypted package and decrypts it using the recipient's private key to obtain the message and message digest encrypted with the sender's private key. Next, the sender decrypts the message digest using the sender's public key. The recipient then runs the message, minus message digest, through the digesting program and compares the message digest so obtained to the message digest included in the message. If they are both the same, the recipient is ensured that the message indeed originated with the sender and that it has not been changed en route.
In practice, entire messages are rarely encrypted/decrypted using public keys. Although possible, most algorithms used for public key encryption are computationally intensive. Accordingly, the usual practice is for the sender to generate a secret "session" key that is used in a symmetric encryption algorithm, which is less computationally intensive than a public key algorithm. The sender encrypts the message with the session key, encrypts the session key with the recipients public key, and sends both to the recipient. To retrieve the sender's message, the recipient decrypts the session key with the recipient's private key, and then uses the session key to decrypt the message.
The use of encryption and digital signatures in electronic transactions over the Internet is further described in "Secure Electronics Transaction (SET) Specification, Draft for testing, Jun. 17, 1996" published on the Internet by Visa International at www.visa.com and by Mastercard at www.mastercard.com.